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How to Win Over Digitally Native Brands

October 15, 2019

Physical stores are becoming an attractive customer acquisition channel for brands that began as online-only retailers. Most have reached a point of decreasing returns and ever-higher acquisition costs for additional customers. They’re hoping that Instagram, where ads are generally cheaper than Facebook, will bring in new buyers, but Instagram’s success as a new-customer channel hasn’t been proven yet.

Warby Parker took the lead in using physical stores to draw new customers and sales. Peloton’s IPO filing explained that the company opened physical stores to attract customers with the opportunity to experience their home exercise equipment, even though customers will generally go home and order from Peloton online.

Digitally native brands have a language and metrics of their own that don’t exist in the world of brick-and-mortar retail. One of the reasons we founded Omnee was to bring the real-world parallels to metrics like “cost per click” to mall operators and your tenants, so you can gather and analyze the data they need to understand what’s really going on inside and outside your doorways.

The language of e-commerce

For online brands, talking about ad viewability is as normal as you discussing storefront dwell. There are a few key concepts to understand. 

  • Impression: the computerized act of serving an ad or other material to a potential customer in their browser.
  • Viewability: the percentage of impressions which are definitely visible to human eyeballs. Many impressions are often served below the bottom of a browser window, or take too long to appear. A three-second delay is long enough for an ad served to go unseen onscreen.
  • Conversion: usually a sale, but can also be used to describe another goal such as signing up for a mailing list.
  • CPM: “cost per mille,” from the French word for thousand. The price for serving one thousand ad impressions, or whatever measurement triggers a fee.
  • CAC: Customer Acquisition Cost. The average price to acquire a new customer through marketing outreach. For established online brands, CAC can run to $200 per new customer.
  • CPA: Cost Per Acquisition. The price for each completed transaction of a specified type—a click, a sale or a form submission that is the end goal of a campaign.
  • CTR: Click-Through Rate. The percentage of people who click on an ad or other call to action. CTRs can be surprisingly low, a fraction of one percent.

If you haven’t yet, log in to Google Analytics to see the dashboards and numbers by which most online retailers gauge their success.

What online brands can learn from you

Online brand professionals may not realize what they don’t know about brick-and-mortar retail. There are a few key differences which you can offer as opportunities to help them reach:

  • Known Customers: You have certainty about your visitors that can only be estimated on a website. Marketing and advertising tech people tout their accuracy at deducing that the person behind a browser is a married fortyish mom in Des Moines, but important metrics like ZAG (ZIP code, age, gender) are still prone to error. By contrast, your typical mall’s visitors nearly all come from the same few ZIP codes, and your in-person surveys are much more accurate at identifying age, gender, and other profile aspects directly, rather than guessing at them based on browsing patterns. You don’t have to run AI to estimate what fraction of your visitors are children or teens.
  • Built-In Targeting: Many, many online campaigns waste a lot of their spend on ads served to people who will never be customers.  They’re in other countries, or they’re too young or old, or they’re obsessive window-shoppers who’ll never buy a thing. They aren’t the potential buyers you hoped to reach through a site, through Google search results or through Facebook ads at all. They just happened to hit that page. By contrast, if someone walks into your mall, they’re almost certainly there to buy something. If they walk into a brand’s store, they’ve qualified themselves as a sale far more than they would by looking at a Web page.
  • Different, but Familiar Metrics: Many online metrics have close parallels in the brick-and-mortar world. You can explain that entering the mall counts as a visit, that walking past a store or display is basically an impression, and that unlike ads on a Web page, displays and signs in a mall are always 100% viewable. This is where Omnee stands out: We empower you to give prospective tenants hard data based on venue-wide, ongoing real-world measurements rather than a few samples or subjective estimates.
  • More than a Point of Sale: Savvy online brands—the Warby Parkers and Pelotons of the world—have recognized mall presence as not just a sales opportunity, but a powerful way to gain mindshare among consumers. Seeing Warby’s eyeglasses on display, or getting to handle a Peloton exercise machine rather than look at online photos, is a powerful draw for new customers even if they’ll make their purchases online later. Wayfair has pop-up presences that aren’t even stores—they serve solely to let mall shoppers know that Wayfair exists online. More brands could learn from these successes.

We can help you connect

Omnee can provide you with unified big-picture data, analysis and insights on an ongoing basis, and teach you how to use the language and lore of e-commerce to better court native online brands. Whether or not the downturn forecast for 2020 happens, online brands will continue to seek real-world locations, and will obviously prefer to lease from those who clearly understand them. Talk to us to find out how you can gain an advantage. 

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